Theory of Constraints · Supply Chain

Availability at minimum inventory.

Most supply chains suffer shortages and excess stock at the same time. The cause is the same: replenishment driven by forecast instead of actual consumption.

We rebuild the chain around pull — so the right product is available at every level, with the least inventory needed to guarantee it.

–40% Inventory through Brabantia's global supply chain — at very high service levels.
–50% Lead time at TKF, across a worldwide internal supply chain.
Daily Replenish what was actually consumed — every day, at every tier of the chain.
The approach

From forecast-push to consumption-pull

The core shift: stop ordering on prediction and batch-size formulas, start replenishing what the chain actually consumed — every day, at every link.

01

Points of sale report actual consumption

Shops and end points report real daily demand upstream. Regional distribution ships based on what was sold — not on what a forecast said would sell.

02

Every tier replenishes the tier below

Central distribution receives daily consumption reports and ships accordingly. Suppliers receive frequent, smaller orders — starting with twice the previous frequency.

03

Set sensible initial buffer targets

Inventory target = demand during reliable replenishment time, plus protection for variability. No need to over-engineer it — the system self-corrects from here.

04

Let buffer management steer execution

Buffer status — green, amber, red — becomes the single priority signal across the chain. Targets adjust dynamically as demand and reliability change.

05

Shrink inventory as the chain speeds up

As replenishment gets faster and more reliable, targets drop automatically. Availability goes up while cash tied in stock goes down.

The building blocks

Concepts every synchronized chain rests on

The decoupling point

The strategic position where forecast-driven production meets consumption-driven replenishment. Placed correctly, it cuts customer lead time while minimising total inventory.

Buffer management

Most chains are under-protected (shortages) or over-protected (excess stock). Buffer management navigates between the two by making buffer status visible and actionable.

Forecast — at the right horizon

Daily replenishment runs on actual consumption. Forecast is reserved for decisions you can't reverse quickly: capacity, long-lead-time material, new distribution points.

Dynamic replenishment

Demand-driven algorithms with dynamic adjustments, pipeline control, and continuous monitoring — supporting the right make / buy / ship / priority decision at every level.

Lot size as a lever

Smaller lots mean shorter lead times and less inventory. The real obstacle is usually changeover time — improve that, and lot size follows.

Throughput per shelf

In retail, shelf space is the constraint. Measure the throughput each product generates per unit of shelf, and exchange slow movers for better ones — don't discount them.

Beyond your own walls

Suppliers as partners, not adversaries

A synchronized chain doesn't stop at your own walls. The biggest inventory reductions come from bringing suppliers into the system.

1

Reward availability, not price

Suppliers earn bonuses tied to delivery reliability and your inventory turns — so their incentives point at your availability, not just their invoice.

2

Share priorities weekly

Suppliers see which orders currently endanger performance. Their lead time and reliability improve — and your inventory targets drop with them.

3

Fix the upstream constraint

When a supplier's buffer sits permanently in the red, the fix isn't a bigger buffer — it's helping the supplier elevate their own constraint. One of the highest-leverage moves in any chain.

Traps

Local optima that damage the whole chain

EOQ & batch-size formulas

Economic Order Quantity optimises per item but ignores the system's constraint — typically producing large batches, high inventory, and long lead times.

Better forecasting as the fix

Uncertainty isn't reduced by predicting better — it's reduced by needing to predict less. Shortening decision and replenishment time beats any forecasting model.

Delocalisation on labour cost

Lower labour cost doesn't automatically mean more profit. A distant factory running efficiently at scale is rarely synchronised with demand — producing shortages and excess at once.

The instruments

The engine behind it: C&DS software

Constraints & Demand Synchronization — our decision-support system that turns these principles into daily practice across your entire chain.

Replenish

Dynamic Replenishment

Demand-driven inventory management for finished goods, semi-finished and raw materials — C&DS Classic algorithms or DDMRP logic, with dynamic adjustments and pipeline control.

Plan

Finite Capacity Planning

Make-to-order, make-to-stock and hybrid models. Every customer request is checked against real capacity and inventory before you commit to a date.

Execute

Buffer Management & POOGI

Execution priorities everyone understands, online delivery-performance visibility, and Pareto analysis of flow obstacles to drive on-going improvement.

Proof

Proven in practice

Synchronized supply chains we have implemented — with C&DS running them every day.

Brabantia — household products, 80 countries

Dynamic Replenishment and Buffer Management across 5 plants and 3 distribution centres. Result: very high service levels with a –40% inventory reduction through the global supply chain — and a planned new UK warehouse cancelled, the existing one running at half capacity.

Read the Brabantia case →

TKF — cable manufacturing, worldwide

Dynamic Replenishment, MTO/MTS planning and Buffer Management across TKF's worldwide internal supply chain, integrated with their ERP. Result: –50% lead time and –30% finished-goods inventory, with tangible results inside 8 months.

Read the TKF case →
Baxter Brabantia TKF Verhaert Space Engie Deknudt Mirrors
Why Bureau Léonard

Expertise you can verify

  • Decades of TOC consulting — supply chain synchronization and dynamic replenishment
  • Implementations across pharma, chemical, electrical, glass, household and retail supply chains
  • C&DS software integrated with the ERP you already run
  • Workshops and training in Dutch, French or English — with know-how transfer

Shortages and excess stock at the same time?

That's not bad luck — it's a design problem. Bring us your chain; in a first working session we'll map where it pushes when it should pull.

Book a working session

info@leonard.eu.com · +32 3 448 06 15 · Kontich, Belgium